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Legislators Asked To Conduct Oversight On Murphy DEP Budget

DEP Deserves Tough Questions

Enforcement fines and permit fee revenue declined by $45 million (30%) from FY’22 

From Billions In Carbon Pollution Subsidies To Mismanagement Of State Lands

DEP’s Budget is up before the Assembly Budget Committee on Monday April 24 at 1 pm.

So, to hopefully spur some critical effort by NJ environmental groups and perhaps even generate media coverage (and encourage something other than the routine softball oversight questions), I just sent the below letter to the budget Committee chairs, urging oversight.

I’ve previously written to oppose diversion of $700 million of federal COVID pandemic relief funds ($1 billion so far), especially when NJ’s public health system is broken and underfunded.

And why are corporations getting a $400 million tax cut, which slashed over $36 million from open space and DEP environmental programs?

I focused primarily on natural resources, and intentionally left out the standard diversion of Clean Energy Fund revenues – absurd at a time of a record $10 billion surplus – and extension of the $300 Million PSE&G nuclear subsides for Doug O’Malley and Tom Johnson to rant about the so called high price of renewables.

Legislators also might want to ask why NJ has not demanded, during RGGI update renegotiations, that the paltry RGGI carbon allowance price ($12.50/ton) be increased to reflect the Social Cost of Carbon. 

The current RGGI allowance price results in billions of dollars of subsidies to fossil fuels. If NJ can not negotiate that increase with the other RGGI States, then DEP could unilaterally impose a carbon emission permit fee based on the SCC. Failure to do so provides BILLIONS of dollars of subsidies to NJ carbon polluters.

And has DEP accelerated the expenditure of RGGI revenues?

In a presentation to Senator Smith’s Forestry Task Force, DEP stated that they were developing a carbon credit and trading scheme for NJ’s forests. That is a huge policy issue that involves millions of dollars and would take legislation. Commissioner LaTourette must be asked about that.

[Update – DEP budget also raided the Spill Fund for $11 million for administrative (staff) costs.]

Here’s my letter:

Dear Chairwoman Marin and Chairman Sarlo:

I am a retired DEP planner and former Policy Director at Sierra Club, NJ Chapter.

For your information, I submit the following material of relevance on 5 specific issues regarding the DEP budget and urge budget committee oversight.

Please ask DEP Commissioner LaTourette:

1) DEP Ignores Economic Value Of Natural Resources

Why has DEP abandoned and failed to implement their own studies? Taxpayers are being ripped off:

“we can confidently state that New Jersey derives very substantial economic benefits from its State parks, forests, and recreation areas, and on economic grounds alone these sites deserve to be preserved and protected. The extent of that preservation and protection depends on many things, some of which are not under human control. However, as a primary actor in the on-going effort to protect and enhance these valuable natural assets, NJDEP has a major responsibility and impact, and the resources it deploys clearly earn a substantial return on society’s investment. The State parks, forests, and recreation areas are not assets that New Jersey can afford to lose; they are in most cases irreplaceable, and their protection merits the constant attention and stewardship of the public officials and residents of New Jersey. (page 55)

DEP also issued this report:

Section III of that Report shows, inclusion of certain ecosystem services provided by New Jersey’s forests could add between $630 and $840 million of benefits annually (present value $21-28 billion). (page 5)

DEP’s scientists and economists found that NJ’s forests provide huge “ecosystems services” and that the value of preserved forests far exceeds logging or “actively managed” forests:

“Valuation of Specific Ecosystem Services Preservation of parks and forests can yield substantial economic benefits in the form of ecosystem services. In fact, ecoservices such as watershed protection and carbon storage can be more valuable than forest products such as wood pulp and timber.”

“A 1997 study in the highly-regarded peer-reviewed journal Nature estimated the value of forest hydrological services at $92/hectare/year in 1994 dollars, including $87 for waste treatment, $3 for water supply, and $2 for flow regulation Costanza et al. (1997). Converting this to U.S. measurement units and 2004 dollars, we obtain a value of $47/acre/year. The 1997 estimate was based on the damage costs incurred when deforestation leads to reduction in water quality or fisheries production, the market value of water lost to reduced quality created by deforestation, and the replacement cost for natural decomposition of wastes.” (see p.30-31)

2) DEP Leases of State Land Fail To Reflect Market Based Value

OLS has also conducted at least 3 audits of the DEP’s leases and concessions program and made negative findings. Over a decade ago, the Legislature directed DEP to Report on the fair market value of State land leases and concession, yet DEP has failed to renegotiate leases to reflect current market value. As result, the State is losing millions of dollars, see:

3) Natural Resource Damage Program Needs Transparency & Regulatory Standards

NJ Courts have rejected DEP NRD lawsuits because DEP failed to adopt science based enforceable standards and economic valuation methods. DEP was required under a judicial consent order to adopt NRD regulations, but has failed to do so. Some suggest that this legal weakness lead to Gov. Christie’s notorious 3 cents on the dollar Exxon settlement. (NJ Law Journal):

… some lawyers and environmental advocates said the state’s failure to adopt a methodology for calculating damages for harm to natural resources through the formal rule-making process—as it committed to do more than a decade ago when it settled another suit—may have weakened its negotiating position and led to a lower settlement in not just the Exxon case but in other natural resource damage suits it has brought. …

A March 23, 2003, letter from deputy attorney general Richard Engel to Picco said the DEP “has long planned to promulgate regulations to improve the current Natural Resource Damage program” and “is currently developing its regulatory proposals, and plans to file one or more rule proposals prior to Aug. 1, 2005.” [end NJLJ]

The DEP is relying on private legal Counsel to litigate “Natural Resource Damage” (NRD) lawsuits, yet they have denied my OPRA requests for information regarding how much those law firms are being paid, see:

The voters approved a referendum to constitutionally dedicate NRD revenues, yet the budget does not include any NRD recovery revenues, despite DEP filing 20 NRD lawsuits (and just one settlement).

DEP entered into a NRD settlement agreement with BASF at the Ciba Geigy Toms River Superfund site, yet that settlement failed to include economic compensation. Why?

4) Budget Shifts Burden From Polluters To Taxpayers

It appears that the DEP is shifting the revenue burden from polluters to taxpayers via the General Fund (and federal funds).

Specifically, enforcement fines and permit fee revenue declined by $45 million (30%) from FY’22 – FY24.  (from $151,178,000 to $105,890,000)

What explains that?

Has DEP abandoned enforcement and longstanding polluter pays policy?

5) DEP Forest Management Program Is Broken

Finally, the DEP’s management and logging of State lands has been a longstanding controversy. The recent case of DEP’s clearcutting of wetlands in the Glassboro Wildlife Management Area is just the most recent example. Senator Smith created a Forestry Task Force, who delivered their framework recommendations in January. Senator Smith has announced pending reform legislation.

According, I recommend that the Committee include budget language to impose a moratorium on DEP Forest management projects until Senator Smith’s Legislative Task Force recommendations are adopted in new legislation. Senator Smith stated that he will introduce a bill in June.

The people and taxpayers want to know why they are being ripped off and their natural resources mismanaged.

I am available to provide further supporting information or clarification upon request.


Bill Wolfe

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